This is not good news.
The U.S. Census Bureau on Jan. 29 reported that the nation’s housing-vacancy rate for ownership units hit an all-time high in the fourth quarter of 2006 – 2.7 percent, or about 50 percent higher than two years ago, when the rate was 1.8 percent. And before 2006, it should be noted, the rate had never cracked the 2 percent ceiling.
That means there are more than 2 million houses sitting vacant and collecting no rents to cover their mortgages. For most owners, even those that engage in real estate speculation and home flipping, that would be a crippling financial hardship over time. More critically, the record vacancy rate, which has risen steadily each of the past five quarters, will likely put further downward pressure on home sale prices that already are in decline.
Why all the fuss? For the past decade or so, despite the dotcom bubble and despite 9/11, the smoking-hot housing market has largely kept the economy afloat. So when you hear people fret about the looming “housing bubble,” they care about more than just the paychecks of real-estate agents and contractors. The tentacles of the housing market touch myriad ancillary economies, such as the retail and durable-goods manufacturing industries that make and sell the things we stuff our homes with.
Because of various factors, Asheville should see its bubble burst later rather than sooner, but it will eventually happen. Nationally, data show far fewer home sales in recent months, lower prices, and a greater length of time on the market for those that do sell. Those and other creeping trends lead some experts to declare the first fwoosh of air has already escaped.
Meantime, stay tuned to this blog for the continuing story.
Note: In April, Xpress will publish an in-depth guide to the area housing market.
– Hal L. Millard, staff writer